Correlation Between National Storage and Pinnacle Investment
Can any of the company-specific risk be diversified away by investing in both National Storage and Pinnacle Investment at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining National Storage and Pinnacle Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Storage REIT and Pinnacle Investment Management, you can compare the effects of market volatilities on National Storage and Pinnacle Investment and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in National Storage with a short position of Pinnacle Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Storage and Pinnacle Investment.
Diversification Opportunities for National Storage and Pinnacle Investment
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between National and Pinnacle is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding National Storage REIT and Pinnacle Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinnacle Investment and National Storage is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on National Storage REIT are associated (or correlated) with Pinnacle Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinnacle Investment has no effect on the direction of National Storage i.e., National Storage and Pinnacle Investment go up and down completely randomly.
Pair Corralation between National Storage and Pinnacle Investment
Assuming the 90 days trading horizon National Storage is expected to generate 4.61 times less return on investment than Pinnacle Investment. But when comparing it to its historical volatility, National Storage REIT is 1.62 times less risky than Pinnacle Investment. It trades about 0.08 of its potential returns per unit of risk. Pinnacle Investment Management is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 854.00 in Pinnacle Investment Management on August 24, 2024 and sell it today you would earn a total of 1,358 from holding Pinnacle Investment Management or generate 159.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Storage REIT vs. Pinnacle Investment Management
Performance |
| Timeline |
| National Storage REIT |
| Pinnacle Investment |
National Storage and Pinnacle Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Storage and Pinnacle Investment
The main advantage of trading using opposite National Storage and Pinnacle Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Storage position performs unexpectedly, Pinnacle Investment can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Pinnacle Investment will offset losses from the drop in Pinnacle Investment's long position.| National Storage vs. Scentre Group | National Storage vs. Vicinity Centres Re | National Storage vs. Cromwell Property Group | National Storage vs. GDI Property Group |
| Pinnacle Investment vs. Ecofibre | Pinnacle Investment vs. iShares Global Healthcare | Pinnacle Investment vs. Ridley | Pinnacle Investment vs. Australian Dairy Farms |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |